Mark Mulligan – Gigaomhttp://gigaom.com
The industry leader in emerging technology researchMon, 19 Mar 2018 12:00:46 +0000en-UShourly1Spotify said to hit 20M users, but it’s no wunderkindhttp://gigaom.com/2012/05/15/spotify-20-million-users/
http://gigaom.com/2012/05/15/spotify-20-million-users/#commentsTue, 15 May 2012 18:50:07 +0000http://gigaom.com/?p=521744Spotify has reached a milestone of 20 million monthly active users, according to music industry blogger and former Jupiter Research analyst Mark Mulligan, who has been tracking Spotify usage with the help of Facebook’s publicly available app data. According to those numbers, Spotify has added half a million new users in the last two weeks alone.

Mulligan estimated that 17 percent of Spotify’s active users are paying for the service, which would mean that the company has around 3.4 million paying subscribers. Growth has been accelerating ever since Spotify launched its advanced social features at Facebook’s f8 developer conference. Spotify grew 4 percent in May of 2011, according to Mulligan, but eight percent since the end of April alone. His verdict: “Facebook integration, coupled with launching in the US has turbo charged Spotify’s growth trajectory.”

Still, Spotify is no wunderkind, and growth alone doesn’t promise success. Mulligan compared Spotify’s growth with that of Pandora, (s P) the now-defunct Imeem and almost forgotten digital music pioneer Last.fm:

Still, Mulligan estimates that Spotify could gain up to eight million paying subscribers within the next 12 months. The company is looking to further kickstart that growth with its app platform as well as a new Pandora-like radio feature within the latest version of its client – something that’s apparently also in the works at competitor Rdio.

A Spotify spokesperson called Mulligan’s numbers “speculation,” but added: “We are very happy with our growth in both daily users and paying subscribers.” Spotify’s most recent publicly released data still references 10 million active users and 3 million paying subscribers, but those numbers were first publicized before the company’s U.S. launch. in January.

]]>http://gigaom.com/2012/05/15/spotify-20-million-users/feed/3Today in Socialhttp://gigaom.com/2011/11/30/spotifys-misguided-one-way-api/
Wed, 30 Nov 2011 18:21:05 +0000http://pro.gigaom.com/?p=90025Spotify announced its platform API that will enable developers to build apps for its own desktop application. Not mobile, yet. And Spotify has no Facebook Connect-like syndication strategy, so this won’t do much to attract new users or lock Spotify in to developer partners. Music industry analyst Mark Mulligan says music itself should be the API, and that’s more like what Napster and Rhapsody tried, in a limited fashion, a few years ago. That is, developers could use those services to play music on their own sites. Sure, this is a smart move for Spotify to add functionality (lyrics, concert info, reviews) to its app with limited work on its part. But there’s limited reward for developers – 10 million users and no revenue sharing isn’t that attractive. And come on guys, Rolling Stone? That’s barely a music brand these days, and certainly one that’s pretty irrelevant to young fans. At least Pitchfork is making playlists, too.
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Tue, 08 Nov 2011 14:10:02 +0000http://pro.gigaom.com/?p=87867I’m heading west for our inaugural RoadMap event, with digital music on my mind. I’ll be presenting a new market forecast, and looking at where the industry is likely to be disrupted. We’ve identified six disruption vectors where companies can gain share and revenues. Can social media save music? Come to the conference to see what we think, and keep an eye out for a report on the subject. Meanwhile, the New York Times profiles Sony Music’s new chief, who sounds pretty old-school. And an old colleague, Mark Mulligan, is always thoughtful on the industry.
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Thu, 14 Apr 2011 17:03:29 +0000http://pro.gigaom.com/?p=64741Everyone’s favorite – but still not in the U.S. – music streaming service Spotify has capped its ad-supported product with number of listens and hours limits. Bobbie Johnson thinks it’s the end of ad-supported on-demand music, and PaidContent wonders if its relative success in converting free users to paid – 1 million subscribers in Europe – will suffer. Forrester’s Mark Mulligan thinks it’s a wise move to improve margins, and possibly set up Spotify’s long-awaited US entry by making a limited service seem less Spotify-lite. Spotify was never going to get the record label deals in the U.S. that it got in Europe, and so far licensing requirements limit ad-based digital music to a radio-like experience. (Full on-demand rights cost more.) Nor have the labels and publishers taken to discounting for scale. There’s a reason on-demand subscriptions haven’t gotten past a few million subscribers, even though Rhapsody and Napster are solid offerings. Unless the rights holders are willing to experiment with price elasticity, this is what digital music is stuck with.
]]>Why YouTube's PRS Spat Is Just One Battle In The Coming Online Music Warhttp://gigaom.com/2009/03/12/419-why-youtubes-prs-spat-is-just-one-battle/
http://gigaom.com/2009/03/12/419-why-youtubes-prs-spat-is-just-one-battle/#commentsFri, 13 Mar 2009 03:47:17 +0000http://paidcontent.wp.gostage.it/2009/03/13/419-why-youtubes-prs-spat-is-just-one-battle/Google’s opposition to proposed new UK music rates may look like just public posturing, as private negotiations continue. But it’s only one instance of what may become an increasingly fractious tug ‘o war between online services and the music business in the next few months.

Almost uniquely, YouTube’s 2007 blanket deal with PRS For Music was inked outside of the “joint online license” framework (JOL), through which the royalty society mandates most digital services. But, just as YouTube’s special deal has ended, so, too, the JOL, which was also implemented in 2007, is due to expire June 30. PRS wouldn’t say what will happen after that date — but, behind the scenes, many more services than YouTube alone have been lobbying hard for a new deal.

“Everybody is; the rates don’t allow you to create an economic model that makes sense,” said We7 CEO Steve Purdham, whose site pays 0.22 pence per track transferred under PRS’ online license. Forrester music analyst Mark Mulligan said: “PRS, right across the board, are upping their fees, like those charged to Oldham Athletic for goal celebrations. This had to happen sooner or later as the labels are going to be applying pressure to PRS. But when the YouTube deal is finally sorted, that won’t be the end of it, they’ll be revising the contracts again, this is not the endgame.” Here’s why:

— No one’s making enough to pay for music: Music licensing is a complex landscape that confuses even many whose livelihoods depend on it. In short, PRS’ online license asks services to pay whichever is greater — either up to eight percent of their gross revenue, a per-track fee of between 0.05 pence and 0.22 pence or a per-subscriber fee of between £0.20 and £0.60 a month, depending on the particular service. The license was mandated by the UK Copyright Tribunal in 2007 after being agreed to by PRS, the BPI, *Yahoo*, *AOL*, *RealNetworks*, *Napster*, *Sony*, *iTunes*, *MusicNet* and the mobile networks.

That would be fine for the many new online services that have launched and reached massive traffic since the license was created — except (and here’s the real story), most of them are finding it hard to earn the money PRS wants for these so-called “minimas”. “Fundamentally, Google (NSDQ: GOOG) is not making enough money off YouTube,” Mulligan said. “Video advertising is nascent at best and YouTube is way behind the curve on that.” In other words, the license was inked before YouTube and others took off, before they’ve had a chance to find a workable business model, and before many of the original signatories went and changed their music initiatives.

Purdham: “If it was just eight percent of revenue, that wouldn’t be a problem, but the minimas kick in to scale. We’ve gotten to 500,000 users in just over 90 days and average visit time is 30 minutes — when you scale it up to the number of plays that YouTube and we have, the numbers become very significant. You’re talking about roughly a penny a stream for on-demand streaming. The question is, how do you make your money? Can you match that cost of playing to the revenue your business can make?”

To support that penny a stream, Purdham said We7 would need to sell ads consistently at £10 per thousand impressions, but it’s currently making between £1 and £12. Assuming Spotify, which has claimed 250,000 UK subscribers, is paying PRS’ on-demand streaming rate of £0.60 per subscriber per month, it could be billed £150,000 per month by PRS — but the per-track fees work out much higher. That’s why Purdham and others are trying targeted techniques to earn higher rates, but that, too, is in its infancy.

— Have the cake or grow the pie? There’s no consensus: PRS has already acknowledged the growing importance of online income, which grew by 40 percent between the first six months of 2007 and 2008. Indeed, some 14 million YouTube plays accounted for a whole 40 percent of the total transactions PRS processed between July and September. But, whilst PRS aims to collect a fair share for artists and others, some say the agency should see the bigger picture. Purdham: “It’s not about whether it’s a penny or 0.22 of a penny or whatever — it’s about the overall value of what this world could be. You’re not talking about tens or hundreds of listeners, you’re talking about perhaps billions of listeners.”

Pandora last year quit the UK, citing excessive fees, and Last.fm, in GooTube’s wake this week, has also called for a fixed online fee like the one radio stations enjoy. Mulligan: “PRS maybe feel now that they’ve overplayed their hand a bit – no one anticipated Google doing what they did. Google have managed to spin the situation to leave the PRS looking like the out-dated, money-grabbing behemoth, whereas Google is looking like the consumer champion.”

But, with the picture unclear on whether the JOL will be revised after June (“There’s nothing I’ve seen that proposes a change to it,” Purdham said), online services must carry on trying to make more money, strike a special deal as Google did or stop using music altogether. PRS, by the same token, must decide whether to reduce its rate in order to grow the overall pie, or to stick to its principles that artists deserve payouts at a constant rate.

— Artists are squaring off against services and labels: In the background, those artists, through Featured Artists Coalition (FAC), and small indies, through the Merlin collective, are uniting against deals they see being done between the big online platforms and the majors, from which services already have to secure a parallel set of rights in addition to PRS. With YouTube reportedly ready to form a music video site with Universal, MySpace Music having been created as a JV with the majors and Nokia (NYSE: NOK) having guaranteed labels private payouts for Comes With Music downloads, the people who create the music, fearing being left out, are raising their hand for a greater influence in contracts. Where these deals have been successful, Warner Music Group (NYSE: WMG) has denied YouTube its songs – just another temporary bargaining tactic.

— The licensing framework is in flux: As if that power struggle wasn’t enough, the ground is shifting beneath everyone’s feet. Already, some of the major music publishers have been withdrawing their repertoire from societies, in favour of doing those direct deals with online services, Mulligan said.

Next up, although the European Commission wants to simplify the complex process of getting pan-European music licenses, its decision last year to open the practice to competition, allowing services to pay royalties to a collector in any part of the EU and not just in their home nation, is likely to mean further confusion. These reforms offer “new potential but also potential delays”, Purdham said: “It used to be fairly simple, but unfortunately the PRS no longer represents all the publishers anymore.”

Instead, PRS faces competition from France’s SACEM, Germany’s GEMA, Holland’s Buma and even societies the publishers themselves are establishing That’s good news for any music service shopping for prices, as they try to license songs for online play – but a worry for individual royalty collectors as they try to maintain principles of fair compensation for artists. It’s still confusing – that’s why services are going direct to publishers. And more change is likely, with the UK government having proposed a “Rights Agency” to oversee copyright relations.

— Google could shape the future: Sure, YouTube’s public protest may just be part of the PRS negotiations – but its defiance could help shape the coming, wider relationships between online services, labels and royalty societies. Mulligan: “It’s a bargaining tactic, and it’s Google playing off against the labels as well. They’ve pulled major-label content and blamed it on the PRS, who have only just come out of a torturous tribunal experience with the labels. Google know very well there are festering wounds there that they’ve dug in to.” A positive outcome is likely – but don’t expect the eventual configuration of this business to be simple, or without losers.

]]>http://gigaom.com/2009/03/12/419-why-youtubes-prs-spat-is-just-one-battle/feed/8Weekend Video: EconMusic: Mobile Music In Decline — What’s The Problem?http://gigaom.com/2008/10/17/419-econmusic-video-mobile-music-in-decline-whats-the-problem/
Sat, 18 Oct 2008 03:51:40 +0000http://paidcontent.wp.gostage.it/2008/10/18/419-econmusic-video-mobile-music-in-decline-whats-the-problem/The big questions at our mobile music panel at our recent EconMusic conference: why is mobile music in decline and what will an effective business in this sector look like? Tom Erskine, Head of Go-to-Market, Nokia (NYSE: NOK) Music explained the problem to lie in the relationship between the digital industry and music labels, while Ian Henderson, VP Digital Business EMEA, Sony (NYSE: SNE) BMG, gave a pessimistic view, saying that mobile music was a lot bigger proportionally a year or two ago. Tom McLennan, Head of Music for Mobile Internet and Content Services, Vodafone (NYSE: VOD) UK, and Julian Zmood, Head of Business Development, Music, O2, joined the panel that was moderated by Mark Mulligan, VP and Research Director, JupiterResearch.

[blip.tv http://blip.tv/play/gZ5G0PB4jppW]
]]>Weekend Video: EconMusic: Mobile Music In Decline — What’s The Problem?http://gigaom.com/2008/10/17/419-weekend-video-econmusic-mobile-music-in-decline-whats-the-problem/
Fri, 17 Oct 2008 20:59:26 +0000http://paidcontent.wp.gostage.it/2008/10/17/419-weekend-video-econmusic-mobile-music-in-decline-whats-the-problem/The big questions at our mobile music panel at last month’s EconMusic conference: why is mobile music in decline and what will an effective business in this sector look like? Tom Erskine, Head of Go-to-Market, Nokia (NYSE: NOK) Music explained the problem to lie in the relationship between the digital industry and music labels, while Ian Henderson, VP Digital Business EMEA, *Sony* BMG, gave a pessimistic view, saying that mobile music was a lot bigger proportionally a year or two ago. Tom McLennan, Head of Music for Mobile Internet and Content Services, *Vodafone* UK, and Julian Zmood, Head of Business Development, Music, O2, joined the panel that was moderated by Mark Mulligan, VP and Research Director, JupiterResearch.

Mobile music, the art of welding a Walkman to a handset, has so much promise – but in most countries outside the Far East it’s still just that. Two thirds of mobile users don’t want music, said a recent survey from Jupiter Research, so its research VP Mark Mulligan, our panel moderator, kicked off this session thusly: “Will Europeans ever behave like Japanese?”

Against that backdrop, Sony (NYSE: SNE) BMG’s EMEA digital VP Ian Henderson was predictably pessimistic: “If you look at the money we’re making from mobile music, it’s going down – mobile music was a lot bigger proportionally a year or two years ago. But, at the same time, we are really excited about what Nokia (NYSE: NOK) and SonyEricsson (NSDQ: ERIC) and Omnifone are doing. There’s a lot of hope but, right now, mobile music is in decline.

So what’s the problem? As ever, the relationship between digital folks and the labels. Vodafone (NYSE: VOD) UK head of music Tom McLennan: “It’s been a bit like the cha-cha. We’ve been bouncing around each other, finding out how we should work together, rather than being in the tango, where we’re up close and personal.”

But what will an effective mobile music business look like? Perhaps subscription music, as practiced by Vodafone through MusicStation and Orange through MusiqueMax in France, is the way forward? As McLennan said of his consumers: “They’re already subscribing to a service anyway – why not let them subscribe to their content?” But Mulligan responded: “Music subscriptions on the PC have essentially failed.”